119-s968

[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[S. 968 Introduced in Senate

    (IS) ]

<DOC>

119th CONGRESS
 1st Session
 S. 968

 To amend the Internal Revenue Code of 1986 to allow for a credit 
 against tax for rent paid on the personal residence of the taxpayer.

_______________________________________________________________________

 IN THE SENATE OF THE UNITED STATES

 March 11 (legislative day, March 10), 2025

 Mr. Warnock introduced the following bill; which was read twice and 
 referred to the Committee on Finance

_______________________________________________________________________

 A BILL

 To amend the Internal Revenue Code of 1986 to allow for a credit 
 against tax for rent paid on the personal residence of the taxpayer.

 Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

 This Act may be cited as the ``Rent Relief Act of 2025''.

SEC. 2. REFUNDABLE CREDIT FOR RENT PAID FOR PRINCIPAL RESIDENCE.

    (a) In General.--Subpart C of part IV of subchapter A of chapter 1 
of the Internal Revenue Code of 1986 is amended by inserting after 

section 36B the following new section:

``

SEC. 36C. RENT PAID FOR PRINCIPAL RESIDENCE.

 ``

    (a) In General.--In the case of an individual who leases the 
individual's principal residence (within the meaning of 

section 121) 
during the taxable year and who pays rent with respect to such 
residence in excess of 30 percent of the taxpayer's gross income for 
such taxable year, there shall be allowed as a credit against the tax 
imposed by this subtitle for such taxable year an amount equal to the 
applicable percentage of such excess.
 ``

    (b) Credit Limited by 100 Percent of Small Area Fair Market 
Rent.--Solely for purposes of determining the amount of the credit 
allowed under subsection

    (a) with respect to a residence for the 
taxable year, there shall not be taken into account rent in excess of 
an amount equal to 100 percent of the small area fair market rent 
(including the utility allowance) applicable to the residence involved 
(as most recently published, as of the beginning of the taxable year, 
by the Department of Housing and Urban Development).
 ``
            (c) Definitions and Special Rules.--For purposes of this 
section--
 ``

    (1) Applicable percentage.--
 ``
        (A) In general.--Except as provided in 
 subparagraph
        (B) , the applicable percentage shall be 
 determined in accordance with the following table:

 The applicable
``If gross income is: percentage is:
 Not over $25,000............................. 100 percent 
 Over $25,000, but not over $50,000........... 75 percent 
 Over $50,000, but not over $75,000........... 50 percent 
 Over $75,000, but not over $100,000.......... 25 percent 
 Over $100,000................................ 0 percent.

 ``
        (B) High-cost areas.--In the case of an 
 individual whose principal residence is located in an 
 area designated by the Secretary of Housing and Urban 
 Development as an area which has high construction, 
 land, or utility costs relative to area median gross 
 income for purposes of 

section 42
            (d) (5) , each of the 
 dollar amounts in the table contained in subparagraph
        (A) shall be increased by $25,000.
 ``

    (2) Partial year residence.--The Secretary shall 
 prescribe such rules as are necessary to carry out the purposes 
 of this section for taxpayers with respect to whom a residence 
 is a principal residence for only a portion of the taxable 
 year.
 ``

    (3) Special rule for individuals residing in government-
 subsidized housing.--In the case of a principal residence--
 ``
        (A) the rent with respect to which is subsidized 
 under a Federal, State, local, or tribal program, and
 ``
        (B) with respect to which the taxpayer elects the 
 application of this paragraph,
 in lieu of the credit determined under subsection

    (a) , there 
 shall be allowed as a credit against the tax imposed by this 
 subtitle for such taxable year an amount equal to \1/12\ of the 
 amount of rent paid by the taxpayer (and not subsidized under 
 any such program) during the taxable year with respect to such 
 residence.
 ``

    (4) Rent.--The term `rent' includes any amount paid for 
 utilities of a type taken into account for purposes of 
 determining the utility allowance under 

section 42

    (g)

    (2)
        (B)
            (ii) .
 ``
            (d) Reconciliation of Credit and Advance Payments.--The amount of 
the credit allowed under this section for any taxable year shall be 
reduced (but not below zero) by the aggregate amount of any advance 
payments of such credit under 

section 7527A for such taxable year.''.

    (b) Advance Payment.--Chapter 77 of the Internal Revenue Code of 
1986 is amended by inserting after 

section 7527 the following new 
section:

``

SEC. 7527A. ADVANCE PAYMENT OF RENT CREDIT.

 ``

    (a) In General.--Not later than 6 months after the date of the 
enactment of the Rent Relief Act of 2025, the Secretary shall establish 
a program for making advance payments of the credit allowed under 

section 36C on a monthly basis to any taxpayer who--
 ``

    (1) the Secretary has determined will be allowed such 
 credit for the taxable year, and
 ``

    (2) has made an election under subsection
            (c) .
 ``

    (b) Amount of Advance Payment.--
 ``

    (1) In general.--For purposes of subsection

    (a) , the 
 amount of the monthly advance payment of the credit provided to 
 a taxpayer during the applicable period shall be equal to the 
 lesser of--
 ``
        (A) an amount equal to--
 ``
            (i) the amount of the credit which the 
 Secretary has determined will be allowed to 
 such taxpayer under 

section 36C for the taxable 
 year ending in such applicable period, divided 
 by
 ``
            (ii) 12, or
 ``
        (B) such other amount as is elected by the 
 taxpayer.
 ``

    (2) Applicable period.--For purposes of this section, the 
 term `applicable period' means the 12-month period from the 
 month of July of the taxable year through the month of June of 
 the subsequent taxable year.
 ``
            (c) Election of Advance Payment.--A taxpayer may elect to receive 
an advance payment of the credit allowed under 

section 36C for any 
taxable year by including such election on a timely filed return for 
the preceding taxable year.
 ``
            (d) Internal Revenue Service Notification.--The Internal Revenue 
Service shall take such steps as may be appropriate to ensure that 
taxpayers who are eligible to receive the credit under 

section 36C are 
aware of the availability of the advance payment of such credit under 
this section.
 ``

    (e) Authority.--The Secretary may prescribe such regulations or 
other guidance as may be appropriate or necessary for the purposes of 
carrying out this section.''.
            (c) Conforming Amendments.--

    (1) Section 6211

    (b)

    (4)
        (A) of the Internal Revenue Code of 
 1986 is amended by inserting ``, 36C'' after ``36B''.

    (2) Paragraph

    (2) of 

section 1324

    (b) of title 31, United 
 States Code, is amended by inserting ``, 36C'' after ``36B''.
            (d) Clerical Amendments.--

    (1) In general.--The table of sections for subpart C of 
 part IV of subchapter A of chapter 1 of the Internal Revenue 
 Code of 1986 is amended by inserting after the item relating to 
 

section 36B the following new item:

``

Sec. 36C. Rent paid for principal residence.''.

    (2) Advance payment.--The table of sections for chapter 77 
 of such Code is amended by inserting after the item relating to 
 

section 7527 the following new item:

``

Sec. 7527A. Advance payment of middle class tax credit.''.

    (e) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after December 31, 2025.
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